What is a decisive victory?
Economies of Scale and Marginal Advantage
In most cases this advantage is achieved through economies of scale. Otherwise, it is normally achieved by having a “marginal-advantage.” A marginal advantage is when your competitive advantage is able to give you a profit ratio or profit amount that is significantly higher then your competitor.
How do you achieve an decisive victory?
- Identify competitive advantage: This is achieved by first identifying a competitive advantage. Sometimes its very visible, and it is something that can be planned and prepared. Other times it is simply an anomaly and it occurs by happenstance.
- Exploit competitive advantage: You would then set up your business processes in a way to leverage and scale this advantage until you have either an advantage; advantage either in: “price or differentiation”
- Achieve decisive victory: after you’ve scaled your processes and you’ve now have a sustained advantage, you want to use this to influence suppliers, distributors, and customers.
- Reinvest, Repeat, and Reinvent: With the new profits, you want to reinvest them into your competitive advantage. This means improving your business process further. Repeat and reinvent refers to finding new competitive advantages that you could exploit.